Record First Quarter Sales Increased 11% with Strength Across All Segments and Channels, Representing the 5th Consecutive Quarter of Year-Over-Year Growth
Record First Quarter Gross Profit Expanded 6% to $202.6 Million
First Quarter EBIT Increased 26% to $32.7 Million
First Quarter EBIT Before Non-Core Items Increased 11%
First Quarter Net Profit Increased 46% to $17.6 Million
First Quarter Net Profit Before Non-Core Items Increased 22%
Strong Balance Sheet with Net Debt to EBITDA, Excluding IFRS 16, of 0.7x
Dividend Declared of $8.0 Million for the First Quarter 2025
Delta Galil Industries, Ltd. (DELG/Tel Aviv Stock Exchange), the global designer, manufacturer and marketer of branded and private label intimate, activewear, loungewear and denim apparel for ladies, men, and children, today reported financial results for the first quarter ended March 31, 2025.
- First quarter sales increased 11% to a first quarter record of $498.7 million, driven by growth in all segments and channels
- First quarter online sales of the Company’s own brands increased 21%
- Gross profit in the first quarter increased 6% to $202.6 million, compared to $190.5 million last year
- First quarter EBIT before non-core items increased 11% and reached $32.7 million, compared to $29.4 million, for the first quarter last year
- Net Debt to EBITDA, excluding IFRS 16, was 0.7x for the quarter ended March 31, 2025, compared to 0.7x last year
- Strong balance sheet with $91.9 million in cash and record shareholders’ equity of $817.7 million at March 31, 2025
- Declares a $8.0 million dividend for the first quarter 2025, same as for the first quarter last year
Isaac Dabah, CEO of Delta Galil, stated, “Delta delivered record first quarter sales, reflecting strong momentum across all segments and retail channels. Our top-line performance underscores our efforts to fuel the growth of our brands and partners through exceptional design and a relentless focus on innovation, quality and sustainability. This growth, combined with disciplined cost controls, yielded solid year-over-year gains in EBIT, EBITDA and net income.”
Mr. Dabah added, “While the macroeconomic environment has grown more complex amid evolving U.S. trade policies, our growth initiatives remain on track. We continue to see strong demand from key customers and are well positioned to gain market share due to our strategically located manufacturing facilities in countries with low tariff exposure.”
“With a profitable model, and a strong balance sheet, we’re well-positioned to invest in our multi-year growth plan. We believe our powerful platform, committed team, and global focus, will allow us to navigate any near-term economic challenges, while pursuing long-term growth opportunities to deliver lasting value for our shareholders,” concluded Mr. Dabah.
Sales
The Company reported first quarter 2025 sales of $498.7 million, an 11% increase from $450.8 million in the first quarter of 2024.
Gross Margin
Gross profit in the first quarter was $202.6 million compared to $190.5 million in the first quarter of 2024.
Gross margin in the first quarter of 2025 was 40.6% compared to 42.3% for the same period last year. The year-over-year reduction in the first quarter gross margin was due primarily to higher freight costs, 90 basis points impact of foreign currency exchange-rates and lower export subsidy in our Egyptian operations.
EBIT
EBIT in the first quarter of 2025 was $32.7 million, compared to $26.0 million, in the first quarter last year.
EBIT before non-core items in the first quarter of 2025 was $32.7 million, or 6.6% of sales, compared to $29.4 million, or 6.5% of sales, in the same period last year.
The year-over-year increase in first quarter EBIT was primarily due to higher sales and controlled operating expenses.
Non-Core Items
For the first quarter of 2025, the Company recorded no non-core expenses. For the first quarter of 2024, expenses associated with the Company’s previously disclosed realignment plan for Bare Necessities were $3.4 million.
Net Income
Net income in the first quarter of 2025 increased 46% to $17.6 million, compared to $12.0 million in the same period last year.
Net income excluding non-core items, net of tax in the first quarter of 2025, increased 22% to $17.6 million, compared to $14.5 million in the first quarter of 2024.
Diluted Earnings Per Share
Diluted earnings per share in the first quarter of 2025 increased 56% to $0.62, compared to $0.39 in the first quarter last year.
Diluted earnings per share, excluding non-core items, net of tax, increased 26% to $0.62 in the first quarter of 2025 compared to $0.49 in the first quarter of 2024.
EBITDA, Cash Flow, Net Debt, Equity, and Dividend
EBITDA, excluding IFRS 16, in the first quarter of 2025 increased 7% to $40.5 million, compared to $37.7 million in the first quarter of 2024.
Cash flow generated from operating activities, excluding IFRS 16, was $4.0 million, compared to $23.5 million in the first quarter of 2024. The year-over-year reduction in operating cash flow was primarily attributable to changes in working capital to support expected sales growth, additional new brands and longer lead-time.
Net Debt to EBITDA, Excluding IFRS 16, as of March 31, 2025, was 0.7x and at a similar level compared to March 31, 2024.
Equity on March 31, 2025, was $817.7 million, up 7% from $764.6 million on March 31, 2024.
Delta Galil declared a dividend of $8.0 million, or $0.3065 per share, which will be distributed on June 10, 2025, with a record and “ex-dividend” date of May 28, 2025.
2025 Financial Guidance
The Company’s previous guidance provided in its 2024 annual report did not include any impacts from new tariff legislation on imports to the U.S. that recently became effective. In light of the uncertainty with respect to country specific reciprocal tariff rates, the Company has withdrawn its prior guidance.
The Company is working to offset the effects of tariffs by sharing the impacts with its long-term vendors and strategically optimizing the Company’s sourcing and production to countries with lower exposure to tariffs. The Company estimates that based on current tariff rates, the potential impact on 2025 annual operating income will not exceed $20 million. In addition, the Company is taking proactive measures to reduce annual operating expenses by $5-7 million.
Constant Currency - Excluding the Impact of Foreign Currency
This release refers to “reported” amounts in accordance with IFRS accounting principles (���GAAP”), which include translation and transactional impacts from foreign currency exchange rates. The release also refers to “constant dollar” amounts, which exclude the impact of translating foreign currencies into U.S. dollars, and are considered a non-GAAP financial measure. These constant currency performance measures should be viewed in addition to, and not in lieu of, or superior to, Delta Galil’s operating performance measures calculated in accordance with GAAP.
About Delta Galil Industries
Delta Galil Industries is a global designer, manufacturer and marketer of branded and private label apparel products for men, women and children. Since its inception in 1975, the Company has continually endeavored to create products that follow a body-before-fabric philosophy, placing equal emphasis on comfort, aesthetics and quality. Delta Galil develops innovative seamless apparel including bras, shapewear and socks; intimate apparel for women; underwear for men including under its owned brands Schiesser, Eminence, Organic Basics, and Athena; babywear, activewear, sleepwear, and loungewear including under its owned P.J. Salvage and Delta brands. Delta Galil also designs, develops markets and sells branded denim and apparel under the brand 7 For All Mankind®, and ladies’ and kids’ apparel under the brand Splendid®. In addition, it sells its products under brand names licensed to the company, including adidas, Wolford, Wilson, Columbia, Tommy Hilfiger, Polo Ralph Lauren and others. For more information, visit www.deltagalil.com.
Safe Harbor Statement
Matters discussed in this press release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words "anticipate," "believe," "estimate," "may" "intend," "expect" and similar expressions identify such forward-looking statements. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein, and while expected, there is no guarantee that we will attain the aforementioned anticipated developmental milestones. These forward-looking statements are based largely on the expectations of the Company and are subject to a number of risks and uncertainties. These include, but are not limited to, risks and uncertainties associated with: the impact of economic, tax rates in the various countries the Company operates in, competitive and other factors affecting the Company and its operations, markets, product, and distributor performance, the impact on the national and local economies resulting from terrorist actions, and U.S. actions subsequently; and other factors detailed in reports filed by the Company.
DELTA GALIL INDUSTRIES LTD.
|
|||||
|
March 31 |
|
December 31 |
||
|
2025 |
|
2024 |
|
2024 |
|
(Unaudited) |
|
(Audited) |
||
|
Thousands of Dollars |
||||
Assets |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash equivalents |
90,188 |
|
187,369 |
|
120,509 |
Restricted Cash |
1,732 |
|
1,859 |
|
1,305 |
Trade receivables |
210,538 |
|
204,655 |
|
271,873 |
Income taxes receivable |
2,805 |
|
1,436 |
|
1,927 |
Other accounts receivable |
58,809 |
|
50,177 |
|
56,998 |
Financial derivative |
8 |
|
76 |
|
160 |
Inventory |
458,085 |
|
394,283 |
|
400,533 |
Asset held for sale |
1,773 |
|
1,773 |
|
1,773 |
Total current assets |
823,938 |
|
841,628 |
|
855,078 |
|
|
|
|
|
|
Non-current assets: |
|
|
|
|
|
Investments accounted for using the equity method and long-term receivables |
12,825 |
|
15,068 |
|
12,824 |
Investment property |
2,464 |
|
2,585 |
|
2,401 |
Property, plant and equipment, net, including under construction |
302,825 |
|
253,698 |
|
288,346 |
Goodwill |
139,411 |
|
144,730 |
|
138,033 |
Intangible assets, net of accumulated amortization |
297,458 |
|
292,567 |
|
294,899 |
Right of use assets |
288,825 |
|
237,880 |
|
257,629 |
Deferred tax assets |
31,694 |
|
30,967 |
|
30,537 |
Financial derivative |
170 |
|
714 |
|
511 |
Total non-current assets |
1,075,672 |
|
978,209 |
|
1,025,180 |
Total assets |
1,899,610 |
|
1,819,837 |
|
1,880,258 |
DELTA GALIL INDUSTRIES LTD.
|
|||||
|
March 31 |
|
December 31 |
||
|
2025 |
|
2024 |
|
2024 |
|
(Unaudited) |
|
(Audited) |
||
|
Thousands of Dollars |
||||
Liabilities and Equity |
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Short-term bank loans |
12,014 |
|
38,102 |
|
2,335 |
Current maturities of long term bank loans |
21,567 |
|
24,965 |
|
20,939 |
Current maturities of bonds |
29,471 |
|
29,662 |
|
29,476 |
Financial derivative |
1,222 |
|
1,143 |
|
1,314 |
Current maturities of leases liabilities |
79,323 |
|
51,908 |
|
53,663 |
Trade payables |
235,619 |
|
203,982 |
|
237,371 |
Income taxes payable |
18,661 |
|
29,729 |
|
23,805 |
Provision for realignment plan |
7,303 |
|
3,563 |
|
8,142 |
Others payables |
173,623 |
|
142,261 |
|
194,900 |
Total current liabilities |
578,803 |
|
525,315 |
|
571,945 |
|
|
|
|
|
|
Non-current liabilities: |
|
|
|
|
|
Bank loans |
118,310 |
|
133,471 |
|
124,163 |
Post-employment benefits obligation, net |
5,418 |
|
5,434 |
|
5,810 |
Lease Liability |
230,972 |
|
206,311 |
|
225,802 |
Other non-current liabilities |
48,103 |
|
53,441 |
|
49,105 |
Bonds |
63,291 |
|
94,996 |
|
64,712 |
Deferred taxes liabilities |
34,079 |
|
33,521 |
|
33,394 |
Financial derivative |
2,957 |
|
2,746 |
|
1,765 |
Total non-current liabilities |
503,130 |
|
529,920 |
|
504,751 |
Total liabilities |
1,081,933 |
|
1,055,235 |
|
1,076,696 |
|
|
|
|
|
|
Equity: |
|
|
|
|
|
Equity attributable to shareholders in the parent company: |
|
|
|
|
|
Share capital |
23,714 |
|
23,714 |
|
23,714 |
Share premium |
123,800 |
|
126,219 |
|
124,025 |
Other capital reserves |
23,651 |
|
23,168 |
|
15,590 |
Retained earning |
632,409 |
|
573,560 |
|
625,912 |
Treasury shares |
(9,464) |
|
(12,026) |
|
(9,832) |
|
794,110 |
|
734,635 |
|
779,409 |
Non-controlling interests |
23,567 |
|
29,967 |
|
24,153 |
Total equity |
817,677 |
|
764,602 |
|
803,562 |
Total liabilities and equity |
1,899,610 |
|
1,819,837 |
|
1,880,258 |
DELTA GALIL INDUSTRIES LTD.
|
|||||
|
Three months ended March 31 |
% Increase/(Decrease) |
|||
|
2025 |
|
2024 |
|
|
|
(Unaudited) |
|
|||
|
Thousands of Dollars |
|
|||
|
Except for Earning Per Share data |
|
|||
Sales |
498,670 |
|
450,779 |
11% |
|
Cost of sales |
296,082 |
|
260,280 |
|
|
Gross profit |
202,588 |
|
190,499 |
6% |
|
% of sales |
40.6% |
|
42.3% |
|
|
Selling and marketing expenses |
142,346 |
|
134,811 |
6% |
|
% of sales |
28.5% |
|
29.9% |
|
|
General and administrative expenses |
28,048 |
|
26,407 |
6% |
|
% of sales |
5.6% |
|
5.9% |
|
|
Other income, net and Share in profits of investees accounted for using the equity method |
(486) |
|
(69) |
|
|
Operating income excluding non-core items |
32,680 |
|
29,350 |
11% |
|
% of sales |
6.6% |
|
6.5% |
|
|
Non-core items |
- |
|
3,360 |
|
|
Operating income |
32,680 |
|
25,990 |
26% |
|
Financing expenses, net |
9,597 |
|
10,938 |
(12%) |
|
Income before tax on income |
23,083 |
|
15,052 |
|
|
Income taxes expenses |
5,480 |
|
3,003 |
|
|
Net income for the period |
17,603 |
|
12,049 |
46% |
|
Net income for the period excluding non-core items, net of tax |
17,603 |
|
14,486 |
22% |
|
|
|
|
|
|
|
Attribution of net earnings for the period: |
|
|
|
|
|
Attributed to Company's shareholders |
16,219 |
|
10,339 |
|
|
Attributed to non-controlling interests |
1,384 |
|
1,710 |
|
|
|
17,603 |
|
12,049 |
|
|
|
|
|
|
|
|
Net diluted earnings per share attributed to company's shareholders |
0.62 |
|
0.39 |
|
|
Net diluted earnings per share, before non-core items, net of tax, attributable to Company's shareholders |
0.62 |
|
0.49 |
27% |
|
DELTA GALIL INDUSTRIES LTD.
|
|||
|
Three months ended March 31 |
||
|
2025 |
|
2024 |
|
(Unaudited) |
||
|
Thousands of Dollars |
||
|
|
|
|
Cash flows from operating activities: |
|
|
|
Net income for the period |
17,603 |
|
12,049 |
Adjustments required to present cash flows from operating activities |
19,748 |
|
43,337 |
Interest paid in cash |
(8,961) |
|
(8,522) |
Interest received in cash |
439 |
|
1,234 |
Income taxes paid in cash, net |
(10,393) |
|
(12,524) |
Net cash generated from operating activities |
18,436 |
|
35,574 |
|
|
|
|
Cash flows from investment activities: |
|
|
|
Acquisition of property, plant including under construction |
(20,635) |
|
(12,295) |
Acquisition of intangible assets |
(5,320) |
|
(17,364) |
Proceeds from sale of property, plant and equipment |
1,724 |
|
220 |
Others |
(407) |
|
416 |
Net cash used in Investing activities |
(24,638) |
|
(29,023) |
|
|
|
|
Cash flows from financing activities: |
|
|
|
Dividend paid to non-controlling interests in subsidiary |
(1,679) |
|
(1,800) |
Payment of long-term payable in connection with acquisition of property, plant and equipment under construction |
(1,203) |
|
(1,406) |
Principal elements of lease payments |
(14,386) |
|
(12,087) |
Dividend paid |
(10,023) |
|
(9,021) |
Receipt of long-term bank loans |
967 |
|
543 |
Repayment of long-term bank loans |
(7,434) |
|
(6,154) |
Short-term credit from banking corporations, net |
9,463 |
|
37,282 |
Others |
(232) |
|
1,734 |
Net cash generated from (used in) financing activities |
(24,527) |
|
9,091 |
Net increase (decrease) in cash and cash equivalents |
(30,729) |
|
15,642 |
|
|
|
|
Effects of exchange rate changes on cash and cash equivalents |
408 |
|
(2,736) |
|
|
|
|
Balance of cash and cash equivalents at the beginning of the period, net |
120,509 |
|
174,463 |
Balance of cash and cash equivalents at the end of the Period, net |
90,188 |
|
187,369 |
DELTA GALIL INDUSTRIES LTD.
|
|||
|
Three months ended March 31 |
||
|
2025 |
|
2024 |
|
(Unaudited) |
||
|
Thousands of Dollars |
||
Reconciliations required to present cash flows generated by operating activities: |
|
|
|
Adjustments in respect of: |
|
|
|
Depreciation |
8,263 |
|
8,331 |
Amortization |
16,812 |
|
17,610 |
Exchange rate (gains) losses |
(163) |
|
410 |
Interest in respect of bonds and loans |
5,623 |
|
5,798 |
Interest received in cash |
(439) |
|
(1,234) |
Taxes on income paid in cash, net |
10,393 |
|
12,524 |
Deferred taxes on income, net |
(1,701) |
|
(4,545) |
Interest expenses recognized in respect of lease agreements |
3,338 |
|
2,724 |
Retirement benefit obligation, net |
(514) |
|
187 |
Change in realignment provision |
(839) |
|
(11) |
Gain from disposal of property, plant and equipment |
(477) |
|
(76) |
Share-based payments expenses |
414 |
|
401 |
Share in profits (loss) of investee accounted for using the equity method |
147 |
|
(60) |
Others |
271 |
|
(1,241) |
|
41,128 |
|
40,818 |
Changes to operating assets and liabilities: |
|
|
|
Decrease in trade receivables |
63,763 |
|
33,480 |
Increase in other receivable |
(1,888) |
|
(1,777) |
Increase (decrease) in trade payables |
(6,604) |
|
35,460 |
Decrease in other payables |
(23,823) |
|
(28,330) |
Increase in inventory |
(52,828) |
|
(36,314) |
|
(21,380) |
|
2,519 |
|
19,748 |
|
43,337 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20250522253869/en/
Contacts
For more information:
Nissim Douek
+972-54-5201178
Nissim@unik.co.il
U.S. Media Contact:
Stacy Berns
Berns Communications Group
+1-212-994-4660
sberns@bcg-pr.com
